McGriff requires an estimate of the cost of goods lost by fire on March $9.$

Merchandise on hand on January $1$ was $$60,000.$

Purchases since January $1$ were $$260,000,$freight$-$in $$5,000$

purchase returns and allowances, $,$$$8,000.$ Sales are made at $,16\%$

above cost and totaled $,350,000$ to March $9.$ Goods costing $$10,500$

were left undamaged by the fire; remaining goods were destroyed.

Instructions

$($a$)$ Compute the cost of goods destroyed.

$($b$)$ Compute the cost of goods destroyed, assuming that the gross profit is

$20\%$ of sales.